POS Transactions Surge by 603%, Surpassing ATM Usage – CBN

By Epiphanus Obia

The Central Bank of Nigeria (CBN) has reported a massive shift in consumer payment preferences, with Point-of-Sale (POS) transactions outpacing Automated Teller Machine (ATM) usage by 603% in the first half of 2024.

According to data from the CBN’s quarterly statistical bulletin, Nigerians carried out transactions worth N85.91 trillion through POS terminals during this period, compared to just N12.21 trillion via ATMs. This trend highlights the growing reliance on digital and cashless payment methods amid persistent cash shortages at bank ATMs.

POS Transactions See Rapid Growth

When compared to 2023, POS transactions in 2024 recorded a 77% increase in value, rising from N48.44 trillion to N85.91 trillion. The volume of transactions also grew by 31%, climbing from 4.87 billion to 6.39 billion. Experts attribute this growth to the wider availability of POS terminals, ease of transactions, and ongoing cash shortages.

In contrast, ATM transactions declined by 16.6%, with the total transaction value dropping from N14.63 trillion in 2023 to N12.21 trillion in 2024. The volume of ATM withdrawals also saw a slight dip, falling from 519.52 million to 496.43 million.

Cash Scarcity and High POS Charges

Despite the increased reliance on POS transactions, many Nigerians faced higher charges toward the end of 2024. POS agents doubled their transaction fees, charging up to N200 for every N5,000 withdrawal due to cash shortages in banks and ATMs.

During the festive season, most ATMs were empty, forcing customers to depend on POS agents, even at higher costs. Banks also rationed cash withdrawals, limiting customers to N10,000 or N20,000 per transaction.

CBN Sanctions Banks for ATM Cash Shortages

In response to the cash crisis, the CBN fined nine commercial banks a total of N1.35 billion for failing to provide cash via ATMs. The affected banks, including Fidelity Bank, First Bank, Zenith Bank, UBA, and others, were each fined N150 million. These penalties were directly deducted from their accounts with the CBN.

Rise in Fraud Cases Linked to POS Transactions

While POS usage continues to rise, so have fraudulent activities. A report from FITC on Fraud and Forgeries in Nigerian Banks revealed that POS-related fraud cases increased by 31.12% in the first quarter of 2024. see report

The number of reported POS fraud cases jumped from 2,683 in Q4 2023 to 3,518 in Q1 2024, raising concerns about the security of transactions conducted through this payment channel.

Mobile and Internet Banking Also on the Rise

Beyond POS, mobile banking transactions surged by 64%, with the total transaction value rising from N97.06 billion in 2023 to N159.42 billion in 2024. The number of mobile transactions also increased by 50%, reaching 3.49 billion.

Internet banking recorded even greater growth, more than doubling from N462.17 billion in 2023 to N825.5 billion in 2024.